Last checked at 18 Sep 2008 07:00
GCM RESOURCES PLC
(AIM: GCM)
PRELIMINARY ANNOUNCEMENT OF THE RESULTS
FOR THE YEAR ENDED 30 JUNE 2008
GCM Resources (GCM) is committed to the Phulbari Coal Project in Bangladesh, the development of which is awaiting approval from the Bangladeshi Government. Over the year, the draft Coal Policy, which will set the direction for the country's coal sector development, continued to be reviewed by relevant departments of the Bangladeshi Government. Given the importance of this in the development of the Bangladeshi economy, the agreement of the draft Coal Policy remains high on the political agenda.
While GCM continues to work with the Government and people of Bangladesh to prepare for the development phase of the Phulbari Coal Project, the Company continues to review investments in other related opportunities around the world. In addition to the investment in Coal of Africa which was acquired in June 2007, GCM now also has investments in Aura Energy Ltd and Regent Pacific Group.
Through all its investments, GCM aims to help bring about further economic and social development for all stakeholders. It aims to do this in a safe and sustainable way, paying full regard to the interests and concerns of local communities and the environment in which it operates.
KEY DEVELOPMENTS
GCM continued to work closely with all stakeholders as the Company waits to proceed with the development stage of the Phulbari Coal Project;
GCM increased its strategic investment in Peoples Telecommunications and Information Services Ltd (PeoplesTel), now holding 37% of the enlarged capital of the company, up from 26.5% ;
GCM accepted Regent Pacific Group Ltd's (RPG) share offer for the whole share capital of CCEC Ltd in respect of its 6% holding in CCEC Ltd. GCM now holds 2% of RPG;
GCM purchased 13% of the capital of Aura Energy Ltd (Aura). Aura has uranium exploration interests in Sweden, West Africa and Australia. The Aura / GCM Africa Alliance grew as it was granted three uranium exploration licence areas in Mauritania. There are 11 further licences pending in Mauritania and three in Niger;
GCM's investment in Coal of Africa Ltd (previously GVM Metals) has substantially increased in value from a cost of £4.8 million in December 2006;
Polo Resources acquired 29.72% of the share capital of GCM on 25 March 2008 as it expanded its interests in strategically located coal projects;
In December 2007 the Company changed its name to GCM Resources plc to remain consistent with the Company's strategy and corporate branding.
Transition to International Financial Reporting Standards (IFRS)
GCM is reporting preliminary results for the year ended 30 June 2008 in accordance with International Financial Reporting Standards (IFRS) for the first time and so the results for the year ended 30 June 2007 in this report are also reported in accordance with IFRS. The impact of the transition from UK GAAP to IFRS was detailed in the 2007 Annual Report.
Results
The Group made a profit of £864,000 after tax for the twelve months to 30 June 2008 (June 2007: loss of £923,000). The profit was primarily due to the gain made on disposal of GCM's interest in CCEC Ltd, when Regent Pacific Group acquired the whole share capital of CCEC Ltd.
Exploration expenditure relating to the Phulbari Coal Project amounted to £2,494,000 for the twelve months to 30 June 2008 (June 2007: £3,286,000).
The Income Statements, Statement of Changes in Equity, Balance Sheet and Cash Flow are presented on the following pages.
Consolidated Income Statement for year ended 30 June
| 2008 | 2007 | ||
| £000 | £000 | ||
| Operating expenses | |||
| Exploration costs | 139 | 42 | |
| Share based payments | - | 833 | |
| Administrative expenses | 1,806 | 1,541 | |
| Operating loss | (1,945) | (2,416) | |
| Profit on disposal of investment | 2,486 | - | |
| Finance revenue | 742 | 1,163 | |
| Profit/(loss) before tax | 1,283 | (1,253) | |
| Taxation | 419 | (330) | |
| Profit/(loss) for the year | 864 | (923) | |
| Earnings/ (loss) per share | |||
| Basic (pence per share) | 1.8p | (1.9)p | |
| Diluted (pence per share) | 1.6p | (1.9)p |
Consolidated Statements of Changes in Equity for year ended 30 June
| Share Capital | Share premium account | Other reserves | Accumulated losses | Total | |
| £000 | £000 | £000 | £000 | £000 | |
| Balance at 1 July 2006 | 4,877 | 42,664 | 346 | (1,811) | 46,076 |
| Change in fair value of available-for-sale financial assets | - | - | 4,656 | - | 4,656 |
| Tax on items taken directly to equity | - | - | (1,304) | - | (1,304) |
| Share based payments | - | - | 375 | 833 | 1,208 |
| Loss for the financial year | - | - | - | (923) | (923) |
| Equity share options exercised | 4 | 22 | - | - | 26 |
| Share issue costs refundable | - | 45 | - | - | 45 |
| Balance at 30 June 2007 | 4,881 | 42,731 | 4,073 | (1,901) | 49,784 |
| Change in fair value of available-for-sale financial assets | - | - | 31,587 | - | 31,587 |
| Tax on items taken directly to equity | - | - | (8,148) | - | (8,148) |
| Transfer to income statement on disposal of available-for-sale financial assets | - | - | (2,486) | - | (2,486) |
| Share based payments | - | - | 122 | - | 122 |
| Profit for the financial year | - | - | - | 864 | 864 |
| Equity share warrants exercised | 220 | 1,433 | - | - | 1,653 |
| Balance at 30 June 2008 | 5,101 | 44,164 | 25,148 | (1,037) | 73,376 |
Consolidated Balance Sheets as at 30 June
| 2008 | 2007 | ||
| £000 | £000 | ||
| Current assets | |||
| Cash and cash equivalents | 10,047 | 16,932 | |
| Receivables | 776 | 551 | |
| Total current assets | 10,823 | 17,483 | |
| Non-current assets | |||
| Property, plant and equipment | 241 | 310 | |
| Intangible assets | 23,710 | 21,216 | |
| Financial assets | 48,799 | 12,068 | |
| Total non-current assets | 72,750 | 33,594 | |
| Total assets | 83,573 | 51,077 | |
| Current liabilities | |||
| Payables | 643 | 306 | |
| Total current liabilities | 643 | 306 | |
| Non-current liabilities | |||
| Deferred tax liabilities | 9,554 | 987 | |
| Total non-current liabilities | 9,554 | 987 | |
| Total liabilities | 10,197 | 1,293 | |
| Net assets | 73,376 | 49,784 | |
| Equity | |||
| Share capital | 5,101 | 4,881 | |
| Share premium account | 44,164 | 42,731 | |
| Other reserves | 25,148 | 4,073 | |
| Accumulated losses | (1,037) | (1,901) | |
| Total equity | 73,376 | 49,784 |
Consolidated Cash Flow Statements
For year ended 30 June
| 2008 | 2007 | ||
| £000 | £000 | ||
| Cash flows from operating activities | |||
| Profit (loss) before tax | 1,283 | (1,253) | |
| Adjusted for: | |||
| Depreciation of non-current assets | 15 | 14 | |
| Share based payments | - | 833 | |
| Profit on disposal of investment | (2,486) | - | |
| Finance revenue | (742) | (1,163) | |
| (1,930) | (1,569) | ||
| Movements in working capital: | |||
| Decrease (increase) in operating receivables | (77) | (72) | |
| Increase (decrease) in operating payables | 211 | 105 | |
| Cash used in operations | (1,796) | (1,536) | |
| Interest received | 770 | 1,096 | |
| Net cash used in operating activities | (1,026) | (440) | |
| Cash flows from investing activities | |||
| Payments for property, plant and equipment | (19) | (47) | |
| Payments for intangible assets | (2,172) | (3,112) | |
| Payments for investments | (5,321) | (7,623) | |
| Net cash used in investing activities | (7,512) | (10,782) | |
| Cash flows from financing activities | |||
| Issue of ordinary share capital | 1,653 | 26 | |
| Refund of share issue costs | - | 45 | |
| Net cash generated by financing activities | 1,653 | 71 | |
| Total decrease in cash and cash equivalents | (6,885) | (11,151) | |
| Cash and cash equivalents at the start of the year | 16,932 | 28,083 | |
| Cash and cash equivalents at the end of the year | 10,047 | 16,932 | |
The audited financial information for the years ended 30 June 2008 and 30 June 2007 contained in this document do not constitute statutory accounts as defined in the Companies Act 1985. The comparative financial information is based on the statutory accounts for the financial year ended 30 June 2007, as adjusted for the adoption of IFRS. Those accounts, upon which the auditors issued an unqualified opinion with an emphasis of matter paragraph, have been delivered to the Registrar of Companies. The financial information for the year ended 30 June 2008 has been extracted from the financial statements of GCM Resources plc which will be delivered to the Registrar of Companies in due course. The auditors have issued an unqualified opinion with a similar emphasis of matter paragraph on the Group's statutory financial statements for the year ended 30 June 2008.
For further information:
| GCM Resources plc Stephen Bywater Chief Executive +44 (0) 20 7290 1630 Graham Taggart Finance Director +44 (0) 20 7290 1630 | Pelham PR Charles Vivian +44 (0) 20 7743 6672 Klara Kaczmarek +44 (0) 20 3159 4395 |
| JPMorgan Cazenove Nominated Adviser MichaelWentworth-Stanley SteveBaldwin +44 (0) 207 588 2828 | |
| GCM Resources plc | |
| Tel: +44 (0) 20 7 290 1630, Fax: +44 (0) 20 7290 1631 | |
| info@gcmplc.com; www.gcmplc.com | |